Prime Minister Kevin Rudd has told a memorial service for the Victoria bushfire victims Black Saturday has redefined courage, given us new heroes, and vowed that every year on February 7 Australian flags would fly at half mast.

Victorians have been remembering the 209 victims of the country's worst bushfire disaster at a memorial service in Melbourne.

Mr Rudd told tens of thousands of mourners filling Melbourne's Rod Laver Arena, and millions more watching the service being beamed live across the nation, that there is a new army of heroes, with the firefighter's helmet commanding as much respect as the slouch hat of old.

"For Black Saturday, what we saw at work was the worst of nature, but the best of humanity," he said.

Mr Rudd told the crowd the "great Australian family" is supporting those affected by the devastating fires, along with an almighty army of volunteers and an ocean of goodwill from around the world.

"When the histories of nations are written, these are times which sorely test each nation's soul," he said.

He says Australians have shown resilience and exemplified true Australian values.

"Courage is a firefighter standing at the gates of hell unflinching and unyielding," he said.

"Courage is neighbour saving neighbour ... stranger saving stranger."

Mr Rudd vowed to rebuild every community.

"These communities are Australia. And we would be a lesser Australia without any of them," he said.

The service was marked by music, with many wiping away tears as Indigenous soprano Deborah Cheetham sang the national anthem.

A choir also performed Hallelujah.

Church bells rang out across the state to mark the start of the service and a minute's silence was also observed towards the end of the ceremony.

Bells also rang out around Rod Laver arena and the crowd stood in silence as Mr Rudd laid white lilies on a large wreath.

Aboriginal leader Auntie Joy Murphy officially welcomed those to the land of the Wurundjeri people.

Queen's message

Other political leaders and dignitaries also paid their respects, including Princess Anne.

She read a message written by the Queen soon after the bushfires occurred.

"Although a little daunted, when faced with the scale of loss, and the physical and mental impact that these bushfires have made and are still making for Victoria, individuals and towns have responded with resilience, ingenuity, courage and selflessness to situations that were changing at terrifying speed," Princess Anne said.

Princess Anne added her own condolences to the bushfire victims, and said she would visit some of the affected areas tomorrow.

"I would particularly thank all those involved in whatever capacity, in the emergency services and in the voluntary organisations," she said.

'We will rebuild'

Governor-General Quentin Bryce told the service bushfire-affected communities would rebuild.

"We will open our hands and reach out and deep to give of ourselves whatever we are able. We each have our separate tasks, we know what they are and together we know the responsibilities we share," Ms Bryce said.

"In time, what was will be restored - no matter how colossal the effort."

Meanwhile, Federal Opposition Leader Malcolm Turnbull praised the fire-ravaged communities for already starting to piece their lives back together and standing strong in the face of adversity.

"We mourn those we have lost," he said

"We are united in our sorrow for those who loved them.

"The measure of our support for you, indeed the measure of love for you, must be whatever it takes.

"Whatever it takes to put you back on your feet. Whatever it takes to heal broken bodies and soothe broken hearts.

'United in grief'

In his tribute, Victorian Premier John Brumby described how the bushfires consumed everything in their path.

"Today we are a state and nation in deep mourning," he said.

"Indiscriminate fires have taken too many and too much.

"These fires have united us all in grief. They have united us all in our response.

"Our nation stands with you as one," he added, directing his comments to the victims.

"In these that have been the worst of times, we have seen the very best of human nature."

Victoria's Governor David de Kretser said there were no words to encompass the distress of those who had lost loved ones.

"These have also been difficult days for all Victorians. Days of fear, of pain and now of haunting sadness," he said.

"It is not only family and friends who have suffered loss. Entire communities have been devastated by these fires."

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